New Delhi: After steel, the sugar industry has come on the radar of anti-trust regulator Competition Commission of India that has called a meeting of sugar associations next week to ensure they do not violate the competition law.
“Fears have been expressed by some government officials that associations have become a platform for cartelisation, especially in homogeneous products like tyre, cement, sugar etc.,” CCI’S acting chairman Vinod Dhall told PTI.
The CCI will meet the representatives of sugar associations on May 27 to apprise them of provisions of the Competition Act and penalties for indulging in cartelisation, abuse of dominance or any other market-abusive practices.
Indian Sugar Mills Association (ISMA) and National Federation of Co-operative Sugar Factories (NFCSF) are the two major associations of the sugar industry.
The sugar sector has been witnessing a glut from 2006-07 season. Sugar production stood at 28.3 million tons in 2006-07 season and the output is expected to be 27 million tons in the current season. Sugar season runs from October to September.
In order to bail out the sugar industry, the government is providing export incentive to enable them liquidate the surplus stock in global market and has also created a buffer stock of five million tons.
During the last 4-5 months, the anti-trust regulator has called manufacturers of cement, shipping, pharmaceutical among others, for the purpose of advising and alerting them, Dhall added.
”We have asked the associations of such industries to themselves declare that they will not involve in any kind of cartelisation. And they should discourage their members also from entering into such practices,“ Dhall said.
The meeting assumes importance as the government grapples to combat the rising inflation, which reached 7.83 per cent for the week ended May 3.